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A look at retirement accounts and divorce in Kentucky

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Jul 17, 2014

A look at retirement accounts and divorce in Kentucky

Posted By
Louis P. Winner

Every financial decision made when going through divorce in Kentucky is
important because these decisions can impact a spouse's lifestyle,
expenses and financial stability. A spouse should think things through
and ensure that each decision will not have legal consequences. A divorcing
spouse usually claims a share of different marital assets, such as marital
homes, businesses, automobiles and bank accounts.

The retirement account of an ex-spouse is often overlooked during divorce
proceedings. Considering that gray divorces are on the rise, retirement
accounts are one of the assets subject to property division. However,
some spouses disregard retirement assets in their divorce settlement or
agreement. Based on a recent survey that examined more than 500 spouses
who filed for divorce after 10 years or more of marriage, more than one-third
of participants failed to claim a share in their spouse's retirement
accounts. These respondents were also not aware that they could have included
retirement assets in the asset division in the first place.

According to a report, retirement assets may qualify as a marital property
in the event of divorce. If a spouse was married with money already in
a retirement account or a 401(k), then that money is considered separate
property and not included in the division. In equitable property states,
such as Kentucky, marital properties are divided equitably between spouses
meaning that the actual holder of the asset does not matter because it
was obtained during the marriage and it is subject to division.

Many spouses want to obtain a fair share during property division. In order
to reach a reasonable divorce settlement, retirement assets should always
be taken into account. Having a Louisville legal professional who has
thorough knowledge of every financial aspect of divorce may also prove
invaluable.